Wells Fargo Increases Top Executive Ranks

Peter Sinton, Chronicle Senior Writer

Published 4:00 am, Thursday, March 21, 1996

Wells Fargo expanded its top executive corps from six to eight yesterday by naming two more vice chairmen. One will manage commercial and corporate banking from Los Angeles, the other heads the small-business banking unit.

Paul Watson, 56, executive vice president in charge of Wells' commercial banking group since 1993, will move to Southern California to supervise all corporate and commercial lending and cash management for the entire 13-state territory following the merger of Wells Fargo and First Interstate.

EVP Terri Dial, 46, who joined Wells Fargo in 1973 as a teller, becomes a vice chairman and will be the bank's top female executive. Since 1991, Dial has headed the Business Banking Group, which is the largest small-business lender in the country.

Wells CEO Paul Hazen said that relocating Watson and the commercial banking business "fulfills our commitment to having a senior presence in Los Angeles" following the merger, which is set to close April 1.

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Keeping sectors of First Interstate's business and jobs based in Los Angeles became a rallying cry of employees, citizens groups and politicians opposed to the merger of California's second and third largest banks. An aide to L.A. Mayor Richard Riordan welcomed the news that one of the basic business lines will be based in Los Angeles.

But it is unclear how it will translate into jobs. Watson, who grew up in Los Angeles and took a night job at Wells Fargo's check- clearing center while going to the University of San Francisco in 1958, said that three of the top six middle market banking executives reporting to him will come from First Interstate. They are Bob Chereck, EVP of corporate and commercial banking in Texas, Jim Lokey, EVP of commercial banking in Southern California and Linda Tubbs, manager of the Northwest market.

In addition, 13 of the next tier of roughly 30 regional commercial banking officers will come from First Interstate. First Interstate EVP Don Voss will report to Wells Fargo's manager of corporate banking, which makes loans to businesses with revenues of more than $500 million.

"One of the reasons the merger makes sense is that they're strong in corporate lending where we're weak ($4 billion in loans vs. $2 billion for Wells)," said Watson. "And they have less strength in the middle market ($6 billion in loans vs. $8 billion for Wells)."

Despite yesterday's announcements, First Interstate employees, including more than 5,500 in Los Angeles County, will absorb the brunt of the 7,000-plus job cuts expected from the merger.

An internal First Interstate report says only one of the bank's top nine officers, EVP John Lewis, who manages retail banking in the Southwest region, is taking a job with Wells Fargo. Only three of the next 30 executives are said to be making the switch. Some reportedly were offered jobs with less responsibility than they had before and others elected to take generous severance packages of two to three times their annual salary.